Forman Financial Services

Aged Care Strategy – Estate Planning – Purchasing a funeral bond

This can benefit people who are:

  • paying an ongoing means tested fee
  • paying an accommodation contribution
  • whose social security entitlements are reduced under either the assets or income test

Potential Benefits:

  • Amounts invested in a funeral bond are asset and income test exempt as long as the amount invested is within the allowable threshold ($13,000 for 2018/19)
  • Where both members of a couple invest in a funeral bond of $13,000 each, the assessable assets of the couple can be reduced by $26,000

Things to be aware of:

  • If a couple invest in a funeral bond under joint names, the amount invested cannot be more than $13,000 (2018/19) combined to qualify for the exemption.
  • Where the person has a pre-paid funeral in addition to the funeral bond, the funeral bond will not qualify for asset test exemption

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